75574 - Development Economics and Sustainability

Learning outcomes

The purpose of this course is to enable students to rigorously analyse the complex relationship between growth, development and the supporting resource base. Students will be led to analytically assess the possibility and consequences of decreasing returns on living standards and welfare. Although theoretical and general, formal analysis will be complemented by historical reference to acquire a methodological approach relating abstract analysis to actual historical record. Mathematical methods will be used to deal with innovation-led growth but the implicit costs in terms of pollution will be carefully considered. Students will learn that environmental policies are an essential part of the process of development. It will be shown that pollution abatement methods are to be fully considered in the economy’ production core and as crucial determinants of the overall rate of growth. It is an object of the course to shed light on the implicit race between increasing productivity and decreasing returns to natural resources suggesting that, in the long run, the race has no apparent winner.

Course contents

Learning outcomes

The course introduces students to the main issues in sustainable economic development. In particular, students will learn what the main facts of economic growth are; why poverty in some countries persists; why countries are at different stages of economic development; why some countries converge in terms of income per capita and why some others diverge; how to combine economic development and environmental sustainability.

Contents

1. Development and sustainability: questions and issues (Sachs, 2015)

2. From stagnation to growth (Galor, 2005)

3. Poverty traps (Gahtak, 2015 and Matsuyama, 2011)

4. Convergence and Divergence (Aghion, Howitt, 2009, ch 7 and Jones, 2016)

5. Growth and the environment (Aghion, Howitt, 2009, ch 16)

Readings/Bibliography

Aghion, Philippe and Peter Howitt, 2009. The Economics of Growth. MIT Press.

Galor, Oded, 2005, From Stagnation to Growth: Unified Growth Theory, Handbook of Economic Growth, 2005, 171-293

Galor, Oded and David N. Weil, 2000, Population, Technology and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond, American Economic Review, 90, 806-828

Ghatak, Maitreesh, 2015, Theories of Poverty Traps and Anti-Poverty Policies, World Bank Economic Review, 29, S77-S105

Jones, I. Charles, 2016. The facts of Economic Growth. Forthcoming, Handbook of Macroeconomics 2A, Ch1.

Matsuyama, Kiminori, 2011, Imperfect Credit Markets, Household Wealth Distribution, and Development, Annual Review of Economics, 3, 339-362.

Sachs, Jeffrey D., 2015. The Age of Sustainable Development. Columbia University Press.

 

Links to papers and books will be available through the e-learning webpage

Teaching methods

Traditional lectures. Slides will be available in the e-learning web page.

Assessment methods

The assessment method consists in writing and discussing a research project related to one of the topics discussed during classes. The research project should comprise an introduction, a brief literature review, research questions (i.e. what the research project aims to investigate), a methodology section (i.e. what instruments, tools, data should be used in the project) and conclusions with a discussion of expected results.

Office hours

See the website of Rainer Andergassen